June 21, 2016

The government has sought to boost hybrid solar and wind
power projects in the country with incentives and a financing system to
increase renewable energy sources while better using existing transmission
infrastructure and land.

In its draft policy guidelines released on Tuesday, the
Ministry of New & Renewable Resources has set a target of achieving 10 giga
watt (GW) generating capacity by 2022 through hybridisation of solar and wind
power projects.

“The main objective of the policy is to provide a framework
for promotion of large grid connected wind-solar PV system for optimal and
efficient utilisation of transmission infrastructure and land, reducing the
variability in renewable power generation and thus achieving better grid
stability,” as per the draft note that has been put for public comments.

The draft note adds that the policy aims to encourage new
technologies, methods and way-outs involving combined operation of wind and
solar photo-voltaic (PV) plants.

Under the category of wind-solar hybrid power plants, wind
and solar PV systems will be configured to operate at the same point of grid
connection. There can be different approaches towards integrating wind and
solar depending upon the size of each of the source integrated and the
technology type.

The policy proposes to allow hybridisation of existing
wind/solar PV plants with certain conditions as well as new wind-solar hybrid
plants.

The government has proposed that the Central Commission
should lay down the guidelines for determination of generic tariff for
wind-solar hybrid system. Further, the Commission is required to frame
regulations for forecasting and scheduling for the hybrid systems.

It said that all fiscal and financial incentives available
to wind and solar power projects may also be made available to hybrid projects.
“Low cost financing for hybrid projects may be made available through IREDA and
other financial institutions including multilateral banks,” it added.

The government will also support technology development
projects in the field of hybrid systems and for development of standards for
hybrid systems.

The draft policy note comes at a time when India has set an
ambitious target of reaching 175 GW of installed capacity from renewable energy
sources including 100 GW from solar and 60 GW from wind by the year 2022.

The country crossed a mark 26.8 GW of wind and 7.6 GW of
solar power installed capacity last month.

A lot of private capital has been committed to renewable
energy field especially solar and wind power in the last two years. Early this
month, Greenko, a developer of wind and small hydro power projects, raised $230 million from sovereign wealth funds of Abu
Dhabi and Singapore.

In April, Finnish energy company Fortum said it plans to invest €200-400 million ($228-456
million) in solar projects in India, joining firms from Canada to Japan looking
to tap into the South Asian nation’s growing renewable energy sector. India is
the first overseas solar energy market for Fortum.

Last year, emerging markets-focused PE major Actis created a renewable energy platform under Ostro Energy
with initial commitment of $230 million.

In another big development, Japan's SoftBank joined hands with Bharti and Foxconn to bet big on
Indian solar power sector.

Yesterday, Tata Power inked a deal to buy Welspun's
renewable energy assets at an enterprise value of $1.4 billion.